by Art Waskey | Jan 29, 2023 | Art of Sales Weekly, Featured
Personalize the Sale
I have an older car which I use for fun when family comes to visit. As it gets only occasional use, the battery often needs charging. I went online to shop for a charger and found a large assortment of options. However, I had no idea which charger was best for me so I headed to my local auto parts stores. In the first store, the rep showed me three options but gave no recommendation. At my next stop, I talked with a rep who was a charger user himself. He asked me about my specific needs and handed me the charger I should buy. His personalization of the sale was invaluable to me. As a salesperson, it is important to keep in mind that the perceived value of a product or service is how it looks, feels, and sounds to the buyer.
Tailor your Solutions
The online marketplace offers lots of product choices at low prices. In the absence of appropriate descriptive information, however, price doesn’t help you select the right product for you. According to Laura Ramos, VP, Principal Analyst at Forrester, “Sixty percent of customers will stop doing business with sellers that do not tailor solutions to meet their exact needs.” “Forty-three percent of buyers feel embarrassed in front of their peers if sellers’ presentations are not customized to their specific needs.” In the example above of the battery charger, I could have purchased the product online at a lower price. However, it would be of little value to me if it was the wrong charger.
Enhance Perceived Value
Remember, the perceived value is how a product or service looks, feels, and sounds to the buyer. Always present an organized and knowledgeable sales plan that enhances the perceived value of your solution. Personalized perceived value positions enable the seller to build strong, value-driven, long-term customer relationships.
The Value of Peace of Mind
The personalized attention I received from the store rep in the example above added perceived value to the charger I purchased. Going forward, I may still look online for information and prices. But I will buy my auto parts from the local, personalized, added-value distributor who offers me peace of mind that I made the right choice. Get tips and tricks like the above in The Art of Sales books. Or subscribe to the FREE monthly articles here.
by Art Waskey | Jan 23, 2023 | Art of Sales Weekly, Featured
Job-Hopping on the Rise
Today’s labor market is marked by a shortage of talent and many new job options. These factors enable younger employees to pick their spots and social media has accelerated the job-hopping process. Employee retention is now a serious issue for most companies. According to Grant Thornton Consulting, about 68.9 million American workers left their jobs in 2021 — 70% of them voluntarily. The company also reports that over 20% of American workers took a new position in the last year. Forty percent of those are already looking for new jobs.
What Motivates a Move?
Additionally, to address the issue of job retention within your company, you need to understand what motivates the movers. Here are some of the primary reasons for changing jobs today.
Advancement opportunity – Careers are no longer linear. Today, the quickest way up the ladder is with a job change and social media makes that fast and easy. Finding a new job is often more expedient than asking for a promotion. Many times the next step in an organization is limited by the positions available and employees may choose not to wait.
Company loyalty – Companies are no longer seen as being loyal to their workers. In recessionary times, through reorganizations, and as a result of corporate buyouts, the Y and Z generations saw their parents laid off. As a result, Gen Y and Z workers try to build their own unique career paths by moving on before someone moves them out.
Salary increases – Zippia, an online recruitment services provider, reported that in 2022 the average salary increase when changing jobs was 14.8% while wage growth was 5.8%. Today, it is often easier to switch jobs for a hefty pay increase than to ask your boss for a raise.
Better culture – A top reason why people change jobs is to be part of a better work culture. According to Shelby Palmeri of CareerPlug, 72% of employees surveyed reported leaving a job because of a toxic workplace. 51% said they plan on leaving their current job for the same reason.
More perks – The younger generations are looking for a good life/work balance —more personal time off, a shorter time to earn it, and perks. Company matching contributions to 401K saving programs, student loans retirements, flexible hours, and work-from-home are options new workers are seeking.
Work on retention
Lastly, examine your company’s culture carefully to identify weak spots in job retention. Provide competitive compensation packages and clear career path opportunities. The best way to build loyalty and prevent job-hopping is to value your workers.
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by Art Waskey | Jan 16, 2023 | Art of Sales Weekly, Featured
Pricing strategy
One of the top distribution subjects in the last two years has been pricing strategy. In 2021 and through the first half of 2022, systems were related to dealing with supply chain shortages. More recently, inflation has been a problem to address. Customers are experiencing increases from all their major suppliers. In this scenario, how does a distributor maximize its price increase attainment?
Pricing trends and profits
It is easier to increase prices during volatile times. In a review of distribution sales in 2022, Andy Szal of Industrial Equipment News reported, “Strong pricing trends have helped the robust revenue numbers amid stubborn inflation, and despite concerns about where things could be headed in coming months, the economy seems to keep humming along.”
While strong pricing helps beef up revenue numbers, how much of those price increases translate into profits? When we increase prices by 8% to match inflation, for example, we often see only a 6% price attainment.
Sales strategies
Here are some sales strategies you can deploy to strengthen margin and profitability and to maximize price increase attainment.
Promote your added-value worth – Before making your price increase announcement, have your sales team make a list of all the added-value solutions you offer. This should include order accuracy, pricing consistency, on-time performance, and product availability. Given this information, customers are more likely to accept your price increases.
Create a cross-functional price evaluation team – There are always reps that tend to give up on pricing more quickly than others. To offset this, create a cross-functional team that has the authority to make pricing decisions on deals below specific margin thresholds. The team should include members who are versed in determining criteria for maximizing account margins. Reps can be coached by the team on how to make better trade-offs for company profitability. Your percentages will increase.
See the value
In addition to supply chain issues and inflation, B2B channels continue to put the squeeze on distributor pricing pressure. It’s more important than ever to remember that you can’t sell a price increase if you don’t see the value of the product or service yourself.
Promote your added-value solutions and work as a team to maximize your price increase attainment.
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by Art Waskey | Jan 3, 2023 | Art of Sales Weekly, Uncategorized
The ERP solution
I consult with a supplier who offers a single, basic product. Nevertheless, while reviewing his strategic projects, I suggested he add finding an ERP (Enterprise Resource Planning) provider to his to-do list. His company uses apps for warehouse, accounting, and sales. But they are not coordinated through an ERP platform. The apps cannot talk to each other. So while the apps help him internally, they don’t add direct value to the customer. The solution to this digital dilemma is to synch your apps with an ERP.
Provide added values
Today, customers expect the best product quality and on-time delivery. These can be acquired through multiple supply channels with the same manufacturer’s tradename. The supplier’s challenge is to find a way to differentiate himself from his often larger competitors. In addition, with knowledge, experience, financing, and person-to-person availability, the supplier should trumpet his ability to provide these added values. To survive and thrive, these added values must be augmented and communicated using unified digitally transforming integrated software. To be a leader, the supplier must be involved on a digital basis.
Use your historical data
Moreover, to compete against evolving alternative marketplaces, suppliers must define value independently of traditional roles. Virtual marketplace alternatives exist —and are designed — to enable customers to acquire products. To maintain viability with its distributors, the supplier must offer services designed to improve a customer’s experience.
Having historic intimacy with distributors is the differentiator for the supplier. The supplier I consult with has years of stored information related to his distributor- customer spending patterns and other characteristics. Moreover, he realized that he needed to put this data into an enabling, actionable digital system (ERP). In that way, he could maintain and enhance his unique supply chain relationship going forward.
Affordable ERPs
The big virtual marketplace providers have made it easier to acquire products by investing in the initial expensive software development. As a result, today affordable ERP solutions are available to smaller suppliers. In addition, a good ERP provider can offer the supplier better communication channels. Furthermore, using the company’s historic data and connecting its existing apps. An ERP can bring added value to a supplier’s distributor customers.
Better customer relationships
Lastly, the internet has changed the way markets operate. Now is the time to capitalize on digital innovations. In conclusion, ERPs allow you to add value, at a favorable cost. And build better customer relationships.
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by Art Waskey | Dec 19, 2022 | Art of Sales Weekly, Featured
Changes and Challenges
As 2022 comes to a close, it’s time to formulate a plan for 2023. I find that webcasts are a great way to acquire relevant information and ideas. They offer reviews of the changes and challenges of 2022. These include the rapid progression of digitalization, a renewed focus on economic, environmental, and social sustainability, coping with product outages related to the war in Ukraine, and inflation, to name just a few. This all makes creating a productive plan for 2023 a complex process. How do you move from current best practices to the next practices that will help you succeed going forward?
Next Practices
In addition, a mindset for the New Year must include a reflection on the past. In his webcast, “Accelerate Your Productivity Pathway – 3 Areas of Focus for 2023” Paul Pretko, Industry Executive Advisor, stated that business processes have moved from the age of Best Practices to Next Practices.
Furthermore, the Best Practices of the past have leveraged technology to do things better and faster. We are now shifting to what Pretko referred to as Next Practices. These are revolutionary new processes focused on doing more with less. Next Practices involve innovations with distinctly different applications, such as fully automated warehouses. Advanced digital vendor-managed inventory (VMI) platforms and cutting-edge omnichannel enterprise resource planning (ERP) applications are also Next Practices.
The Three Cs
When planning for 2023, look to integrate technology that is comprehensive, convenient, and contemporary. Pretko called these the 3 Cs. Distributors need Comprehensive systems from start to finish; systems that provide a Convenient user experience; and Contemporary services that incorporate technologies like AI.
Pace your Planning
Lastly, the pandemic accelerated changes in business practices. Your challenge in 2023 is finding ways to take your business and employees through these changes cohesively. To attract and integrate the best of the new generation with the old requires adding technology at an acceptable, step-by-step pace. Lead with care to tap into the best from each generation as you move into your next practices for 2023.
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by Art Waskey | Dec 12, 2022 | Art of Sales Weekly, Featured
Digital natives
The pandemic impacted the role of the outside sales rep (See adjusting-to-changes-in-sales-process-relationships) but what about the make-up of their target audience —the B2B customer? Since the early 2020s the profile of the purchasing professional has changed. In the buyer population, Baby Boomers are rapidly being replaced by Millennials, born between 1981 and 1996. Many in this cohort have already joined the management ranks of B2B buyers. Zoomers (or Gen Z, born between 1997 and 2012) are also becoming buyers. Selling to this group of digital natives requires new sales strategies.
A preference for digital interactions
Jason Smith and Paul Demery explain in a recent article that “Many millennials and Gen Z buyers are keeping their distance from traditional sales calls, preferring digital self-service…” A survey of 172 B2B marketers also finds these buyers are showing a strong preference for digital and virtual interactions.
A recent report from Digital Commerce 360 lends further support to the swing toward digital selling. In it MSC Industrial Supply Co. CEO Erik Gershwind relates that the company has been busy improving its entire digital offering. As a result, digital commerce sales increased 17% to $2.28 billion for the fiscal year ending Sept. 3, 2022. By comparison, total sales grew 13.8%.
Today’s purchasing agents use online digital content, blogs, infographics, and videos for making buying decisions. Smith and Demery write that digital content represents 72% of a buyer’s journey. They explain that while in-person events are among the top three strategies, they come in third after online customer case studies and white papers or e-books.
Personalize your research
Today’s sales professionals must be digitally savvy. Growing sales requires a firm understanding of each client’s business and specific customer roles. Use CRMs to conduct thorough customer research and learn the degree of influence your prospect has within the organization. Find out the key factors that shape their pain points then structure your value proposition accordingly. Digitalization enables personalized outreach to clients. Use it to succeed with the new generation of buyers.
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